EXHIBIT (d)(7)
SUB-ADVISORY AGREEMENT
AGREEMENT made as of the 23rd day of April, 1999 by and between Xxxxxx
Xxxxxxx Xxxx Xxxxxx Investment Management Inc., a Delaware corporation (herein
referred to as the "Investment Manager"), and Xxxxxx Xxxxxxx Xxxx Xxxxxx
Advisors Inc., a Delaware corporation, (herein referred to as the
"Sub-Advisor").
WHEREAS, Xxxxxx Xxxxxxx Xxxx Xxxxxx Universal Funds, Inc. (herein referred
to as the "Fund") is engaged in business as an open-end management investment
company and is registered as such under the Investment Company Act of 1940, as
amended (the "Act"); and
WHEREAS, the Investment Manager has entered into an Investment Management
Agreement with the Fund (the "Investment Management Agreement") wherein the
Investment Manager has agreed to provide investment management services to the
various portfolios of the Fund; and
WHEREAS, the Sub-Advisor is registered as an investment adviser under the
Investment Advisers Act of 1940, and engages in the business of acting as an
investment adviser; and
WHEREAS, Investment Manager desires to retain the services of the Sub-
Advisor to render investment advisory services for the Money Market Portfolio of
the Fund (the "Portfolio") in the manner and on the terms and conditions
hereinafter set forth; and
WHEREAS, the Sub-Advisor desires to be retained by the Investment Manager
to perform services on said terms and conditions:
NOW, THEREFORE, in consideration of the mutual covenants and agreements of
the parties hereto as herein set forth, the parties covenant and agree as
follows:
1. Subject to the supervision of the Fund, its officers and Directors, and
the Investment Manager, and in accordance with the investment objectives,
policies and restrictions set forth in the then-current Registration Statement
relating to the Fund, and such investment objectives, policies and restrictions
from time to time prescribed by the Directors of the Fund with respect to the
Portfolio and communicated by the Investment Manager to the Sub-Advisor, the
Sub-Advisor agrees to provide the Fund with investment advisory services with
respect to the Portfolio's investments to obtain and evaluate such information
and advice relating to the economy, securities markets and securities as it
deems necessary or useful to discharge its duties hereunder; to continuously
manage the assets of the Portfolio in a manner consistent with the investment
objective and policies of the Portfolio; to make decisions as to foreign
currency matters and make determinations as to forward foreign exchange
contracts and options and futures contracts in foreign currencies; shall
determine the securities to be
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purchased, sold or otherwise disposed of by the Fund and the timing of such
purchases, sales and dispositions; to take such further action, including the
placing of purchase and sale orders on behalf of the Portfolio, as it shall deem
necessary or appropriate; to furnish to or place at the disposal of the Fund and
Investment Manager such of the information, evaluations, analyses and opinions
formulated or obtained by it in the discharge of its duties as the Fund and the
Investment Manager may, from time to time, reasonably request. The Investment
Manager and the Sub-Advisor shall each make its officers and employees available
to the other from time to time at reasonable times to review investment policies
of the Portfolio and to consult with each other.
2. The Sub-Advisor shall, at its own expense, maintain such staff and
employ or retain such personnel and consult with such other persons as it shall
from time to time determine to be necessary or useful to the performance of its
obligations under this Agreement. Without limiting the generality of the
foregoing, the staff and personnel of the Sub-Advisor shall be deemed to include
persons employed or otherwise retained by the Sub-Advisor to furnish statistical
and other factual data, advice regarding economic factors and trends,
information with respect to technical and scientific developments, and such
other information, advice and assistance as the Investment Manager may desire.
The Sub-Advisor shall maintain whatever records as may be required to be
maintained by it under the Act. All such records so maintained shall be made
available to the Fund, upon the request of the Investment Manager or the Fund.
3. The Fund will, from time to time, furnish or otherwise make available to
the Sub-Advisor such financial reports, proxy statements and other information
relating to the business and affairs of the Portfolios as the Sub-Advisor may
reasonably require in order to discharge its duties and obligations hereunder or
to comply with any applicable law and regulations and the investment objectives,
policies and restrictions from time to time prescribed by the Directors of the
Fund.
4. The Sub-Advisor shall bear the cost of rendering the investment advisory
services to be performed by it under this Agreement, and shall, at its own
expense, pay the compensation of the officers and employees, if any, of the
Fund, employed by the Sub-Advisor, and such clerical help and bookkeeping
services as the Sub-Advisor shall reasonably require in performing its duties
hereunder.
5. The Fund assumes and shall pay or cause to be paid all other expenses of
the Fund, including, without limitation: any fees paid to the Investment
Manager; fees pursuant to any plan of distribution that the Fund may adopt; the
charges and expenses of any registrar, any custodian, sub-custodian or
depository appointed by the Fund for the safekeeping of its cash, portfolio
securities and other property, and any stock transfer or dividend agent or
agents appointed by the Fund; brokers' commissions chargeable to the Fund in
connection with portfolio securities transactions to which the Fund is a party;
all taxes, including securities issuance and transfer taxes, and fees payable by
the Fund to federal, state or other governmental agencies or pursuant to any
foreign laws; the cost and expense of engraving or printing certificates
representing shares of the Fund; all costs and expenses in connection with the
registration and maintenance of registration of the Fund and its shares with the
Securities and Exchange Commission and various states and other
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jurisdictions or pursuant to any foreign laws (including filing fees and legal
fees and disbursements of counsel); the cost and expense of printing (including
typesetting) and distributing prospectuses of the Fund and supplements thereto
to the Fund's shareholders; all expenses of shareholders' and Directors'
meetings and of preparing, printing and mailing proxy statements and reports to
shareholders; fees and travel expenses of Directors or members of any advisory
board or committee who are not employees of the Investment Manager or Sub-
Advisor; all expenses incident to the payment of any dividend, distribution,
withdrawal or redemption whether in shares or in cash; charges and expenses of
any outside service used for pricing of the Fund's shares; charges and expenses
of legal counsel, including counsel to the Directors of the Fund who are not
interested persons (as defined in the Act) of the Fund, the Investment Manager
or the Sub-Advisor, and of independent accountants, in connection with any
matter relating to the Fund; membership dues of industry associations; interest
payable on Fund borrowings; postage; insurance premiums on property or personnel
(including officers and Directors) of the Fund which inure to its benefit;
extraordinary expenses (including but not limited to legal claims and
liabilities and litigation costs and any indemnification related thereto); and
all other charges and costs of the Fund's operation unless otherwise explicitly
provided herein.
6. For the services to be rendered, the facilities furnished, and the
expenses assumed by the Sub-Advisor, the Investment Manager shall pay to the
Sub-Advisor monthly compensation equal to 40% of the fee that the Investment
Manager receives pursuant to the Investment Management Agreement. Any subsequent
change in the Investment Management Agreement which has the effect of raising or
lowering the compensation of the Investment Manager will have the concomitant
effect of raising or lowering the fee payable to the Sub-Advisor under this
Agreement. In addition, if the Investment Manager has undertaken in the Fund's
Registration Statement as filed under the Act (the "Registration Statement") or
elsewhere to waive all or part of its fee under the Investment Management
Agreement, the Sub-Advisor's fee payable under this Agreement will be
proportionately waived in whole or in part. The calculation of the fee payable
to the Sub-Advisor pursuant to this Agreement will be made, each month, at the
time designated for the monthly calculation of the fee payable to the Investment
Manager pursuant to the Investment Management Agreement. If this Agreement
becomes effective subsequent to the first day of a month or shall terminate
before the last day of a month, compensation for the part of the month this
Agreement is in effect shall be prorated in a manner consistent with the
calculation of the fee as set forth above.
7. The Sub-Advisor will use its best efforts in the performance of
investment activities on behalf of the Fund, but in the absence of willful
misfeasance, bad faith, gross negligence or reckless disregard of its
obligations hereunder, the Sub-Advisor shall not be liable to the Investment
Manager or the Fund or any of its investors for any error of judgment or mistake
or law or for any act or omission by the Sub-Advisor or for any losses sustained
by the Fund or its investors.
8. It is understood that any of the shareholders, Directors, officers and
employees of the Fund may be a shareholder, director, officer or employee of, or
be otherwise interested in, the Sub-Advisor, and in any person controlled by or
under common control with the Sub-Advisor, and that the Sub-Advisor and any
person controlled by or under
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common control with the Sub-Advisor may have an interest in the Fund. It is also
understood that the Sub-Advisor and any affiliated persons thereof or any
persons controlled by or under common control with the Sub-Advisor have and may
have advisory, management service or other contracts with other organizations
and persons, and may have other interests and businesses, and further may
purchase, sell or trade any securities or commodities for their own accounts or
for the account of others for whom they may be acting.
9. This Agreement shall remain in effect until March 31, 2001 and from year
to year thereafter provided such continuance is approved at least annually by
the vote of holders of a majority, as defined in the Act, of the outstanding
voting securities of the Portfolio or by the Directors of the Fund, provided,
that in either event such continuance is also approved annually by the vote of a
majority of the Directors of the Fund who are not parties to this Agreement or
"interested persons" (as defined in the Act) of any such party, which vote must
be cast in person at a meeting called for the purpose of voting on such
approval; provided, however, that (a) the Fund may, at any time and without the
payment of any penalty, terminate this Agreement upon thirty days' written
notice to the Investment Manager and the Sub-Advisor, either by majority vote of
the Directors of the Fund or by the vote of a majority of the outstanding voting
securities of the Portfolio; (b) this Agreement shall immediately terminate in
the event of its assignment (within the meaning of the Act) unless such
automatic termination shall be prevented by an exemptive order of the Securities
and Exchange Commission; (c) this Agreement shall immediately terminate in the
event of the termination of the Investment Management Agreement; (d) the
Investment Manager may terminate this Agreement without payment of penalty on
thirty days' written notice to the Fund and the Sub-Advisor; and (e) the Sub-
Advisor may terminate this Agreement without the payment of penalty on thirty
days' written notice to the Fund and the Investment Manager. Any notice under
this Agreement shall be given in writing, addressed and delivered, or mailed
post-paid, to the other party at the principal office of such party.
10. This Agreement may be amended by the parties without the vote or
consent of the shareholders of the Portfolio to supply any omission, to cure,
correct or supplement any ambiguous, defective or inconsistent provision hereof,
or if they deem it necessary to conform this Agreement to the requirements of
applicable federal laws or regulations, but neither the Fund, the Investment
Manager nor the Sub-Advisor shall be liable for failing to do so.
11. This Agreement shall be construed in accordance with the law of the
State of New York and the applicable provisions of the Act. To the extent the
applicable law of the State of New York, or any provisions herein, conflict with
the applicable provisions of the Act, the latter shall control.
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement on the day and year first above written in New York, New York.
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XXXXXX XXXXXXX XXXX XXXXXX
INVESTMENT MANAGEMENT INC.
By: /s/ Xxxxxx X. Xxxxxxx, Xx.
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Attest: /s/ Xxxxx Xxxxxxxx
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XXXXXX XXXXXXX XXXX XXXXXX
ADVISORS INC.
By: /s/ Xxxxx Xxxx
-------------------------------
Attest: /s/ Xxx Xxxx XxXxxxx
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Accepted and agreed to as of
the day and year first above written:
XXXXXX XXXXXXX XXXX XXXXXX
UNIVERSAL FUNDS, INC.
By: /s/ Xxxxxxx X. Xxxxx
________________________________
Attest: /s/ Xxxxx Xxxxxxxx
____________________________
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